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Department of Agrarian Reform, represented by Secretary Jose Mari B. Ponce (OIC) vs. Delia T. Sutton, Ella T.

Sutton-Soliman and Harry T. Sutton G.R. No. 162070 (October 19, 2005) FACTS: Respondents herein inherited a land which has been devoted exclusively to cow and calf breeding. Pursuant to the then existing agrarian reform program of the government, respondents made a voluntary offer to sell (VOS) their landholdings to petitioner DAR to avail of certain incentives under the law. a new agrarian law, Republic Act (R.A.) No. 6657, also known as the Comprehensive Agrarian Reform Law (CARL) of 1988, took effect. It included in its coverage farms used for raising livestock, poultry and swine. Thereafter, in an en banc decision in the case of Luz Farms v. Secretary of DAR this Court ruled that lands devoted to livestock and poultryraising are not included in the definition of agricultural land. Hence, we declared as unconstitutional certain provisions of the CARL insofar as they included livestock farms in the coverage of agrarian reform. Thus, respondents filed with petitioner DAR a formal request to withdraw their VOS as their landholding was devoted exclusively to cattle-raising and thus exempted from the coverage of the CARL. However, DAR issued A.O. No. 9, series of 1993 which provided that only portions of private agricultural lands used for the raising of livestock, poultry and swine as of June 15, 1988 shall be excluded from the coverage of the CARL. The DAR Secretary issued an Order partially granting the application of respondents for exemption from the coverage of CARL but applying the retention limits outlined in the DAR A.O. No. 9. Respondents moved for reconsideration. They contend that their entire landholding should be exempted as it is devoted exclusively to cattle-raising and appealing that the DAR A.O. No. 9 be declared unconstitutional. ISSUE: Whether or not DAR Administrative Order No. 09, Series of 1993 which prescribes a maximum retention for owners of lands devoted to livestock raising is constitutional? HELD: The A.O. sought to regulate livestock farms by including them in the coverage of agrarian reform and prescribing a maximum retention limit for their ownership is invalid as it contravenes the Constitution. . The Court clarified in the Luz Farms case that livestock, swine and poultry-raising are industrial activities and do not fall within the definition of agriculture or agricultural activity. The raising of livestock, swine and poultry is different from crop or tree farming. It is an industrial, not an agricultural activity. DAR has no power to regulate livestock farms which have been exempted by the Constitution from the coverage of agrarian reform. It has exceeded its power in issuing the assailed A.O. The assailed A.O. of petitioner DAR was properly stricken down as unconstitutional as it enlarges the coverage of agrarian reform beyond the scope intended by the 1987 Constitution